A photograph on the website of Wasl Asset Management Group offers a stark reminder of Dubai’s progress since the 1990s. The aerial shot [pictured right] is of Emirates Golf Club, a bright patch of green surrounded by beige desert, punctuated only by small clusters of villas and a deserted highway snaking toward what then seemed like a very faraway Abu Dhabi.
Wasl has been a key player in the dramatic events that have happened in the intervening decades. From its inception in 2007, the real estate management company has amassed one of the largest portfolios in Dubai. Assets that it owns or manages range from residential and commercial properties, to industrial plots, along with leisure and entertainment facilities, hotels and serviced apartments.
But for all its many projects around the city, the company does not have a particularly high profile, having never sought the limelight. Its headquarters are in a modest building in Bur Dubai. Its CEO, His Excellency Hesham Abdulla Al Qassim, has an understated air that belies his title or role in this transformation.
An obvious first question for a company charged with this task is the perennial one asked of real estate in Dubai: how on earth do you control supply and demand in a market that still doesn’t seem to fit the pattern of established international norms?
“You cannot plan for it,” replies Al Qassim, matter-of-factly, sitting in a boardroom looking out over Al Mankhool Road. “Other industries rely on production life cycles. So let’s say you want to manufacture this phone,” he continues, waving a brand-new iPhone at me (presumably a perk of one of his other roles, sitting on the board at Etisalat). “You build it and you’re ready to ship in one month. Then a few weeks later you review your sales and begin again. But in our industry, from executing an idea through to delivery date will take between 36 and 48 months – and that is if you are lucky. In that time you could have two economic cycles.”
Al Qassim says the only way to operate under these circumstances is to hold one’s nerve and stick to a plan. “Ultimately you cannot time your deliveries to perfection,” he says. “You will always have a little bit of over- or under-supply.” He uses the analogy of an engine that needs to keep running to illustrate his point. “You cannot just stop a company of our size from running. But you can slow it down or speed it up.”
Not that Al Qassim is reckless in his approach. His team is constantly producing data analysis to spot new trends or repeat patterns. And with a background in banking – he is also vice chairman and managing director of Emirates NBD and chairman of Emirates Islamic Bank – he says risk analysis is “in his blood”.
But he also knows from hard-won experience that “we are dealing with long spans of time and you can never be exact in your predictions. So that’s why you have to always grow and never stop.”
This approach is greatly helped by the support of Dubai’s government, which has consistently invested in infrastructure regardless of economic cycles. Its willingness to issue bonds and raise loans to plug any budget shortfalls has fostered an environment where progress is made towards the city’s goals whatever the short-term fluctuations in growth.
“Every day there is a new initiative,” says Al Qassim of this ethos. “And every initiative is about making the country more active and creating more jobs. All this combined has made the city what it is today. Having the right governance and the right conditions for trade has allowed this country to flourish.”
Chief among those initiatives, of course, is Expo 2020. Total government investment for the project is forecast at AED25bn ($6.8bn), and Al Qassim thinks it will provide the right platform to tell Dubai’s story to businesses and residents of the future.
“People will see for themselves how this idea has become a fact in such a short space of time. We hope this event will convince them to be a part of the future.”
According to Al Qassim, seamless supply chains are absolutely vital to economic success, and this isn’t just about moving goods or services; it is chiefly about people. Al Qassim uses Emirates Airline as an example of how this works in practise. The passenger experience of coming to Dubai, he says, begins before the visitor has even left their own country. It continues to the flight, the airport, the taxi journey, the quality of roads and the standard of accommodation. In short, everything in that chain has to work properly to guarantee repeat business. “If you have a happy experience all the way through, you will return.”
The conversation diverts to a discussion about maritime trade to illustrate the same point. Al Qassim says there are ports on the Red Sea and Indian Ocean that are closer for passing vessels, yet Jebel Ali Port is still the Middle East’s largest marine terminal thanks to its hyper-quick processing capabilities, which makes it a more convenient stopping point despite the added journey times.
This attention to detail applies on a micro level to Wasl’s operations. For instance, Wasl has 5,500 hotel rooms, including Grand Hyatt Dubai and Le Méridien Dubai Hotel & Conference Centre, with a further 4,500 under development. But rather than simply collect rent, the company provides reams of data and competitor analysis to its operators, including information on tourists coming to the emirate, where they are coming from and how much they are likely to spend. Wasl also helps manage procurement to leverage scale and assists with technical support for supply chains to make them as efficient as possible. This backend support, he says, “gives our operators an edge in the market.”
"I chair Emirates Islamic Bank in Dubai as well as vice-chairing Emirates NBD, which helps as in banking you have lots of information about the economy, you can see how everything is moving. I’m also on the board at Etisalat, which has added a lot to my knowledge and given me insight into technology. Etisalat has operations in Egypt, Saudi and Pakistan, and this helps with my regional knowledge. It gives you exposure to the region. And it’s the same with Emirates NBD where I chair our operations, plus they are operating in the UK, India, Singapore, China, Indonesia, Saudi Arabia... and you learn something in every market. So this has all been a learning curve for me. It has all added experience."
That drive to efficiency has arguably never been more important. Abundant supply, currency shifts, oil prices and a general economic malaise over the past couple of years have put downward pressure on hotel yields as never before. According to his figures, how is the hospitality industry faring in this environment? “As a city we have created enough offerings to attract return visits,” he replies. “Occupancy is holding at 80 percent across the market, which is much higher than other parts of the world.”
The only difference, he says, is the price hotels can charge. “We are becoming a more developed city and the margins are tighter. But as long as occupancy holds up, everything will be okay,” he says.
What he doesn’t accept is that low margins are a permanent reality. “Ultimately the sector wants growth in rates and I believe this will happen in 2019.”
The list of Wasl projects and assets under management is staggering in scale. The company has three main verticals. It is the biggest industrial owner in the city with 5,200 plots and 27 industrial zones. In its second major sector, residential and commercial, it manages 45,000 units across Dubai. This encompasses everything from low-cost housing through to high-end lifestyle offerings.
Traditionally it has built to hold, adjusting to market demand as it goes. “Our occupancy has historically stood at 98 percent,” he says of this strategy. “At present it is more like 95-96 percent. We have more supply than demand, but not too much. It will adjust but it is not instant, it is not sushi.”
Two years ago, however, Wasl finally moved into freehold. Park Gate Residences, the first phase in Wasl One, is comprised of four luxury residential towers overlooking Zabeel Park. It sold out within a week of launching, and mainly to end users. Wasl Gate, near Ibn Battuta in Jebel Ali, will be a fully-fledged community delivered in three phases, along with a “smart mall” conceived by Wasl along with Al Futtaim Group. Nad Al Hammar Gardens is a 6-million square-foot site facing Mohammed Bin Zayed Road, with 71 residential plots and 32 mixed use plots.
Wasl also holds commercial stock across Dubai. When it comes to office space, Al Qassim says: “This sector has been very stable. There has always been a little bit of oversupply but never too much. It is in the right spot.” As for retail, he admits there is pressure on demand but, in the bigger picture, “it will adjust as developers hold stock”.
And in the final vertical, hospitality, Wasl’s present stock will be bolstered by two Mandarin hotels and the partnership announced last year with US-based MGM Resorts International, which will result in two new hotels – an MGM and a Bellagio – along with a theatre and entertainment centre on the 26-acre prime beachfront development next to Sunset Beach in Dubai.
For good measure he motions out of the window toward Port Rashid where a Hilton Gardens Hotel now stands, to be followed by a Hyatt Place and 1,450 residential units. Everywhere one looks, it seems, there is a Wasl project taking shape.
The fact that these many ventures are paid for in cash is a telling indication of the scale on which it operates. “We don’t borrow. We have never borrowed. Any spending comes from revenues,” says Al Qassim. This approach is partly due to his background in banking. “This makes me conservative by nature,” he says. “I never carry risk. I make sure we have enough money to pay my suppliers.
"As long as I am in the office my mind is working 100 percent. I never feel tired when I work until I finish at the end of the day. I have the passion for it, I love what I do. Whenever there is a day when I have a slower schedule, I am bored within five minutes as I have no patience by nature. For instance, today I realised I had a gap after this interview before my next meeting, so I called in some department heads to discuss an idea that has been on my mind. I will admit that time has taught me to be slower. If it is the weekend then fine, I can be with my family and friends and enjoy every second. But in the week I need to work. I have never taken a sick day in my life."
Wasl Asset Management isn’t a listed company so its finances aren’t publicised. Al Qassim says he aims for an even split in revenues between the three aforementioned verticals, but admits it is currently more like 20 percent in hospitality and leisure, 40 percent in residential and 40 percent industrial.
He is confident that the ambitious targets he sets in each segment will be met, thanks to his belief that growth will accelerate as 2020, with all its promise of deepening Dubai’s ties to the world, draws nearer. “The UAE has alliances and trade routes to every region in the world. The Chinese economy is still growing. Africa is a promising market. Dubai will try and capitalise on these links.”
It is no coincidence, he says, that “wasl” means “connection” in Arabic. A lesser-known fact, as Al Qassim points out, is that Dubai’s historical name was Wasl. “Years back, when there was nothing here except a few houses by the Creek, and some boats coming in and out, there was trade between Dubai and the world.”
And Wasl Asset Management is putting the pieces in place to ensure that this story continues long into the future.
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